Mohammed Shosanya
The Governor of the Central Bank, Yemi Cardoso, says $1bn has come into the Nigerian market in the past few days through the bank’s interventions in stabilizing foreign exchange rates in Nigeria
He also said the policies taken so far by the apex bank to stabilize foreign exchange rates have been yielding positive results.
He disclosed these during a briefing of the Joint Senate Committee on Finance, Banking, Insurance, and Financial Institutions in Abuja on Friday.
He noted that these measures would help to stabilise the foreign exchange rates and minimize the distortion that high exchange rates have on inflation, saying they are closely related.
He said, “We have already begun to see shifts in the positive direction. Indeed they (CBN measures) have already started yielding early results with significant interest from foreign portfolio investors which was a concern. That has already begun to supply the much-needed foreign exchange to the economy.
“For example, upward of the past few days, we have had over $1 billion that has come into the market, and this quite frankly has answered the question of if our policies are working,” he added.
He said that with the numbers available, he can say that the market has been responding to the policies they have put in place.
He added that measures aimed at improving US dollar supply in the Nigerian economy have significant potential for taming the volatility of the exchange rate and, in turn, moderating inflation.
He, however, said that for these measures to be sustainable, Nigeria must, as a country, moderate our demands for foreign exchange.
He maintained that the genuine issue impacting the exchange rate is the demand for US dollars for business and personal needs.
The CBN governor also assured that inflation is expected to decline this year using the inflation targeting framework and moderate to 21.1 percent.
